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UK House Prices Up By 1.5% in June

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    New Market Insights from the Nationwide House Price Index

    According to Nationwide’s latest House Price Index, UK house prices increased by 1.5% year-on-year, with the overall average now standing at £266,064.

    The housing market was described as “broadly stable” between May and June, with prices increasing by 0.2%.

    Let’s see how this affects UK property investment in 2024!

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    Nationwide House Price Index

    UK House Prices in June: Regional Breakdown

    Overall, market activity has remained relatively unchanged over the last year despite remaining subdued compared to 2019, with a 15% decrease in overall transactions.

    According to Nationwide, mortgage transactions have seen an even steeper decline of around 25%, most likely due to rising borrowing costs. Cash transactions, on the other hand, have increased by about 5% above pre-pandemic levels.

    Despite solid earnings growth racing ahead of house price increases in recent years, Nationwide suggests the rise in mortgage rates has significantly impacted affordability. For example, interest rates on a five-year fixed-rate mortgage for a borrower with a 25% deposit were just 1.3% in late 2021 but have recently surged to approximately 4.7%.

    From a regional perspective, Northern Ireland and the North West were the joint best-performing areas – with prices up 4.1% compared to Q2 2023.

    Northern regions of England outpaced the South, with a 2.9% increase in house prices annually this quarter. The North was also identified as the most affordable region in the report’s UK Fact File.

    Nationwide’s report states that southern regions experienced a slight decline of 0.3%, consistent with the previous quarter. London was the strongest performing region in the South, with 1.6% annual growth, whilst East Anglia saw prices fall by 1.8%.

    RegionAverage price (Q2 2024)Annual % change this quarterAnnual % change last quarter
    UK£265,0121.20%1.00%
    N Ireland£190,3004.10%4.60%
    North West£213,5804.10%2.90%
    Yorkshire & The Humber£206,6533.80%2.40%
    North£158,4672.90%4.10%
    London£525,2481.60%1.60%
    West Midlands£242,8731.40%-0.20%
    Wales£207,6501.40%1.20%
    Scotland£181,1861.40%3.70%
    East Midlands£231,745-0.20%0.50%
    Outer Met£418,919-0.50%-0.60%
    Outer S East£331,995-1.10%-1.00%
    South West£301,139-1.50%-1.70%
    East Anglia£270,597-1.80%-1.30%

    Learn More: Is buy-to-let still worth it in 2024? Our detailed guides offer some insights into the current state of the housing market and outline the best buy-to-let areas in the UK!

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      What Do the Experts Say?

      Commenting on the figures, Robert Gardner, Nationwide’s Chief Economist, said: “While earnings growth has been much stronger than house price growth in recent years, this hasn’t been enough to offset the impact of higher mortgage rates, which are still well above the record lows prevailing in 2021 in the wake of the pandemic. For example, the interest rate on a five-year fixed-rate mortgage for a borrower with a 25% deposit was 1.3% in late 2021, but in recent months this has been nearer to 4.7%.

      Mike Scott, Chief Analyst at YOPA, believes this data could indicate increasing price growth in the coming months. He said: “Affordability remains stretched but is slowly improving, with average earnings rising considerably faster than house prices and some reductions in fixed-term mortgage interest rates. We expect the pace of price growth to pick up later this year or early next year in response to this.”

      For more information on the current UK property climate, take a look at some of our recent investment insights:

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      Author

      Reece Pape

      Reece Pape is a property writer at RWinvest. Utilising up-to-date property statistics and data, Reece aims to keep investors informed on the latest market developments.

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